A Medical Device Daily

Inverness Medical Innovations (Waltham, Massachusetts), a manufacturer of rapid diagnostic products, reported acquiring substantially all of the assets of First Check Diagnostics (Lake Forest, California), a private diagnostics firm, for about $25 million in cash.

Inverness also will pay an earn-out to First Check equal to the incremental revenue growth of the acquired products for 2007 and for the first nine months of 2008, as compared to the preceding comparable periods.

First Check had 2006 revenues of around $11 million and has been operating profitably.

First Check claims leadership in home testing for drugs of abuse, including marijuana, cocaine, methamphetamines and opiates. It also offers tests, sold through retail channels, for alcohol abuse, cholesterol monitoring and colon cancer screening.

Ron Zwanziger, CEO of Inverness, said that over-the-counter (OTC) drugs-of-abuse testing "has exhibited rapid rates of growth and has strong potential for continued growth. The ability to put drug testing in the hands of the consumer is a powerful tool in the fight against drug abuse and aligns well with Inverness' desire to put diagnostics within the reach of all."

Steve Moak, CEO of First Check said, "Home drug testing is a critical tool in protecting children from drugs, and I believe that Inverness has the resources and experience as a leader in OTC diagnostics to get these products into more homes."

Inverness says it also is exploring opportunities for its electrochemical and other technologies in various professional diagnostic and consumer-oriented applications, including immuno-diagnostics.

In other dealmaking activity:

• Triad Hospitals (Plano, Texas) entered a merger agreement with affiliates of CCMP Capital Advisors and GS Capital Partners in a transaction valued at about $6.4 billion, including about $1.7 billion of debt. Affiliates of CCMP Capital and GSCP will acquire all the outstanding shares of Triad for $50.25 a share in cash.

Triad's board has approved the agreement and recommends that Triad stockholders approve the merger.

James Shelton, CEO and chairman of Triad, said, "The decision to take the company private is the culmination of a strategic planning process initiated several months ago to explore the various options available to the company . . . CCMP Capital and Goldman Sachs are experienced investors in healthcare services, with a solid understanding of the opportunities and challenges that face Triad today."

The transaction is subject to approval of Triad's stockholders, regulatory approvals and other conditions. The deal is expected to close following the satisfaction of these conditions.

Under the agreement, Triad may solicit superior proposals from third parties during the next 40 days. If a superior proposal leads to the execution of a definitive agreement, Triad would be obligated to pay a $20 million break-up fee to CCMP Capital and GSCP and reimburse up to $20 million of their out-of-pocket expenses.

Triad said that it intends to solicit superior proposals.

The company expects stockholders to vote on the merger and is postponing its annual meeting pending the outcome of a special meeting for the vote.

Triad, through its affiliates, operates 54 hospitals and 13 ambulatory surgery centers in 17 states with about 9,855 licensed beds. Through its QHR subsidiary, Triad provides hospital management and advisory services to more than 180 independent hospitals and health systems throughout the U.S.

• Stratagene (La Jolla, California), a manufacturer of specialized life science research and diagnostic products, reported obtaining the last of four co-exclusive licenses to more than 150 microRNA sequences available from Max Planck Innovation, the technology transfer agency of the Max Planck Society. Stratagene will have the right to use the microRNA sequences for the manufacture and sale of molecular diagnostic kits. Financial terms were not disclosed.

MicroRNAs are small RNAs that act to regulate messenger RNA (mRNA) expression. MicroRNAs are believed to regulate many genes, and thus thought to be good indicators for many disease biomarkers. Of particular interest to Stratagene is the association of microRNAs with cancer, it said.

Joseph Sorge, MD, CEO and chairman of Stratagene, said, "The potential of these sequences, when paired with our proprietary FullVelocity technology, should allow us to develop important detection tests for the molecular diagnostics marketplace."

Stratagene's life science research unit develops products used to accelerate research in fields spanning molecular biology, genomics, proteomics, drug discovery and toxicology. Max Planck Innovation advises scientists of the Max Planck Society in evaluating inventions and filing patent applications.

National Health Investors (NHI; Murfreesboro, Tennessee) reported that a special committee of its board has advised it that a $15 dividend and $18 price offered by a prospective buyer "is not to be in the best interests of NHI's public stockholders." Additionally, it said that the committee said that the proposal does not contain all of the material terms of a proposed merger agreement.

It said that the committee advised it to continue operating as a public company to create greater value for public shareholders than the proposal and has requested that management develop and implement a plan to enhance the business and shareholder value of NHI.

NHI specializes in the financing of healthcare real estate.